UN forum hears calls for increased foreign aid to help development

UN forum hears calls for increased foreign aid to help development

As a major United Nations forum on fighting poverty entered its fourth day in Monterrey, Mexico, UN officials and the heads of international trade and finance agencies exhorted rich countries to step up their financial aid to developing nations and to create opportunities for market access and debt relief that would help stimulate economic growth.

Speaking to an audience of more than 50 Heads of State or government, United Nations General Assembly President Han Seung-soo told the International Conference on Financing for Development that no country could achieve rapid development without meeting at least three preconditions.

“First,” Mr. Han said, “it must have access to financial resources, domestic or external, or most likely a combination of the two. Second, it needs the human capacity to efficiently absorb those resources and the wherewithal to build greater human capacity as more resources are generated. And third, it requires the ‘appropriate’ intangible infrastructure such as markets to make productive use of the available resources.”

“The core elements of intangible infrastructure include free enterprise, good governance, sound macroeconomic policies, a strong anti-corruption ethic, and transparently applied rule of law,” he added.

James D. Wolfensohn, President of the World Bank, said that the international community must support nations to build capacity so that they can create an investment climate in their countries and invest in their people. “This is not about rich countries telling developing countries what to do,” he stressed. “This is about creating a chance for developing countries to put in place policies that will enable their economies to grow. Policies that are home grown and home owned. For the surest foundation for long-term change is not development by fiat, but social consensus.”

The Managing Director of the International Monetary Fund (IMF), Horst Koehler, told the audience that the proposed “Monterrey Consensus” outcome document must be transformed into concrete action, “with a sense of urgency.” And as part of a comprehensive and transparent system to monitor progress towards the Millennium Development Goals, “we should identify more clearly the respective responsibilities of poor countries and their development partners – donor countries, international institutions, the private sector, and civil society.”

For his part, Director-General Mike Moore of the World Trade Organization (WTO) called poverty “the greatest single threat to peace, democracy, human rights and the environment.” He urged world leaders to instruct their trade ministers to cast aside “the petty mercantilist methodology” in favour of a “grand bargain” that would see trade barriers dismantled, thus allowing commerce to play its important role in generating finance for development – a role that would also reduce significantly the burden on other facets of the finance for development equation.